“Market Conditions Have Changed” In Arizona
A housing report from the Arizona Republic. “Sales have finally started at the long-anticipated Fulton Ranch housing development in south Chandler, just as the Valley is experiencing a significant slowdown in the real estate market.”
“Fulton Ranch was conceived several years ago when the market for new homes was red hot. A year ago, it boasted a waiting list of 14,000 potential buyers interested in the lake community, where houses will sell from the high $500,000s to more than $1 million. But market conditions have changed.”
“Dennis Webb, vice president of operations of Fulton Homes, said the waiting list has since been whittled down to about 1,800 people by prequalifying buyers and reconfirming interest. He said the biggest challenge now is that many potential buyers have to sell their existing homes first.”
“Bill Ryan, a real estate broker in Chandler, predicts predicts the developer probably won’t get the ‘rampage’ of sales it expects. ‘It takes pretty strong income to be able to afford homes in the $500,000 or $400,000-plus range,’ he said.”
“Houses are taking longer to sell due to the Valley’s housing market slump, and staging or giving them temporary new decor has become the strategy of choice for many sellers and investors.”
“‘You’re setting a mood, and you’re showcasing the lifestyle you could lead in this home,’ said Phoenix interior designer Patti Craze. ‘You’re trying to have the buyer imagine themselves in the space.’”
“Diane Neslund, a Scottsdale interior designer who also does staging, said that it gives the illusion that you’re not desperate to sell your home. ‘People will think that they had better hurry up and buy it or somebody else will,’ she said.”
“With the flood of homes on the market now, buyers have become more selective, said Neslund, owner of Distinctive Interiors and Design in Scottsdale. ‘There is so much competition you have to do something different than the others,” said (realtor) Claudia Michalson.”
“Realtor Pat Hune, who sold Kennedy’s house, said staging isn’t the solution for every for-sale home. ‘If you have a home that’s getting no showings, it’s a price problem,’ she said.”
The Prescott Daily Courier. “The red-hot Arizona housing market of two years ago has cooled considerably. Developers aren’t building new homes because people aren’t buying them.”
“‘We had that spike there for the past two-and-a-half years where everything went crazy,’ said Joe Contadino, developer of the Granville subdivision. ‘Now we’re back at that 2003 level. This notion set in that a house wasn’t a home, it was an investment vehicle. Then the bubble burst.’”
“The town is hoping for a new bubble or, at least, some market improvement by February.”
“‘It’s going to go up, this market that we’re concerned about,’ Councilmember Lora Lee Nye said. ‘Do I have bad dreams or trouble going to sleep sometimes? Sure I do.’”
Some good marketing: ‘Diane Neslund, a Scottsdale interior designer who also does staging, said that it gives the illusion that you’re not desperate to sell your home.’Remember this:
‘Bill Yakobovich’s ritzy north Scottsdale estate sat vacant for nearly five months before he decided to ditch his real estate agent and put the home up for auction. Next month his 4,500-squarefoot Desert Mountain home, which was originally listed for $2.9 million, will sell regardless of price, for no minimum bid and no reserve. The house is guaranteed to sell to the highest bidder when the gavel drops. Desert Mountain home auction When: Nov. 1. Registration begins at 4 p.m., auction at 6 p.m.’
Now the auction site has no mention of this house, either in the upcoming list or on the results page. No reserve indeed. Hey reporters, get on this story!
It is pretty amazing that the results of the auction were not noticed in the local press, given how pricey the property and how relatively (so far) novel the approach. Wonder if it had a buyer’s premium attached.
Wonder if it had a buyer’s premium attached.
Like a fixed $2.4m buyer’s premium? But no reserve price!
“The town is hoping for a new bubble or, at least, some market improvement by February.”
of 2007, 2008 or 2009?
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ain’t gonna happen. cycles take time to play out.
“‘You’re setting a mood, and you’re showcasing the lifestyle you could lead in this home,’ said Phoenix interior designer Patti Craze. ‘You’re trying to have the buyer imagine themselves in the space.’”
Patty “Craze”. Yes, indeed.
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She should add another ‘e’ on the end of her name - “Crazee”.
Friend of mine has a daughter who recently started a staging business in Scottsdale too. Not one of the ones mentioned in this story. Guess the staging business will become pretty competitive too. Wonder how long it’ll be viable at all. People may come to realize that REDUCE THE PRICE IDIOT is a better way.
I think I might start a “Reduce the price business”!
lol…
That’s a great idea. You could probably qualify for an SBA loan. But first you will need a business plan. You will need to detail the supplies needed to start such a business. I will get your list started.
- Nunchucks
- Brass knuckles
- Water board
- Bright lights
- Strait jackets
- The Clockwork Orange setup. You will need to force sellers to view films of foreclosed and bankrupt GFs. Don’t forget the eyedrops.
- Easton aluminum baseball bat
- Louisville Slugger wooden bat (some people still like the sound of wood connecting against the skull)
- Cases of Prozac (there will be massive seller depression)
- Cases of Viagra (it may be difficult for some of the sellers to get a stiffy after they hear what their “palace” is really worth)
- Truncheon
I apologize that I can’t think of more. I hope others can help determine all the tools necessary to get sellers in denial to come to the new reality of the marketplace.
I respectfully disagree on one point NYCB. I think a lot of sellers will be “getting a stiffy”.
St Joseph statue and a shovel, to bury it upside down
“‘You’re setting a mood, and you’re showcasing the lifestyle you could lead in this home,’ said Phoenix interior designer Patti Craze. ‘You’re trying to have the buyer imagine themselves in the space.’”
You know- sitting on cushions on the floor and sleeping on futons because you can’t afford furniture. Sitting in your dark, broiling McMansion and eating Top Ramen during the summer months in Arizona because you can’t afford both the electricity bill and your over-inflated house payment. You know- living a dream!
OT - I’ve recently come back from vacation in AZ, and have noticed a lot of new construction in Flagstaff, especially south of the railroad on Butler and environs. I was last in Flagstaff in 2003, and the place looks much bigger now.
Also, slews of new tract house construction east along the I40 - especially in the ghost towns near Winslow and Holbrook. Seems that the decay and abandonment of previous communities along the road has not stopped someone from thinking it a good idea to throw up hundreds of cookie-cutter houses in the same places. I’d hazard a guess they’ll do just as well as thier ancestors - ie become deserted in a few years.
At least the old ruins have some mid-century charm to them…
The rest of the story on Prescott Valley…
“the town also has only about 1,100 effluent credits, but is marketing 2,741. New and existing homes would generate and remaining 1,600 or so credits.”
If they DON’T auction these credits off, they will pass off to homeowners the cost of importing water into the city…which is mandated (to achieve safe yield) by state law by the year 2025. This is HUGE cost…pumping groundwater out of Big Chino (and this may not even come to pass, since the whole Verde River watershed is so embroiled in other issues)…
So they are counting on a continuing building and buying boom to finance water into the city.
Bummer.
Any of these areas in the SW - water will be a HUGE issue in the next few decades. There is no LT planning for this most critical resource. But at least there’s golf ans swimming. Further delusion of developers.
I so agree…and although AZ positioned/bargained themselves better than the other SW states as far as obtaining CO river water, the desert cities will truly experience serious trouble in the not too distant future. While AZ had a good monsoon, and there are predictions of a wet winter coming up, we are still in a drought cycle.
Developers have absolutely no interest in any of this.
They leave the dumb towns and the local gentry government holding the bag, after they’ve made their quick build/buck.
Makes me think of Sam Kinison on people starving in the desert
,i.“It occurs to us there wouldn’t BE world hunger if you people would LIVE WHERE THE FOOD IS AT! YOU LIVE IN A F@$KING DESERT! YOU SEE THIS, HUH? THIS IS SAND! KNOW WHAT IT’S GONNA BE A HUNDRED YEARS FROM NOW? SAND! GET YOUR SH%T, WE’LL MAKE ONE TRIP, WE’LL TAKE YOU WHERE THE F*%KING FOOD IS AT! WE HAVE DESERTS IN AMERICA, WE JUST DON’T LIVE IN THEM, AS*&%E!”
Oppps. We do live in deserts now.
Sam Kinison. Now he was funny imo. Got to see him in Vegas before he died.
“500,000s to more than $1 million.”
Every where you look they are building communities with prices like this. The math simply does not work here! This is a disaster waiting to happen. There are only so many people that can afford a million dollar house. WHY CANT PEOPLE SEE THIS!
I could not agree more.
Not far from Fulton Ranch, T.R. Lewis (I believe), has homes starting from the mid $700k. I live only a mile from this subdivision. Every morning I wake up in my rental to the smell of cow manure. I wonder how the owners of these new homes will feel about this. I am okay with the smell, because I am only paying $1100/month for my 2300 sf home.
Perhaps before long it will be known as “Futon Ranch.”
“WHY CANT PEOPLE SEE THIS!”
So many communities have become tied to the delusion of mass migration from other parts of the country, that they can’t let go of it and continue operating under their false beliefs.
‘It takes pretty strong income to be able to afford homes in the $500,000 or $400,000-plus range,’ he said.”
Crazyinthe OC :
Agreed. You need to have some serious income or savings to REALLY afford homes over 400 let alone 900. That is the whole problem with this bubble. This above statement has not been true - almost anyone could get a 400 mortgage - only qualification: a pulse.
Paramount is a compaqny in Tempe that manufactures windows. In fact they make windows for Fulton Homes. Paramount has shut their assembly line down and laid off many of the workers. They still have a stock of windows but the manufacturing is done for now.
After 17 years in the SE Valley, I have but one thing to say about Fulton Ranch. If they don’t cut at least 40% off the proposed asking prices, that place is toast. It will sit empty and slowly populate one parcel at a time over the next 5 to 10 years. I guess I had two things to say.
Read the story “The Emperor has no clothes”….
Staging a house is like putting lipstick on a pig.
When will clueless sellers, realtors, and now interior designers realize that in this market, it is all about the price.
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I guess some fools fall for this shiiit.
This point of staging is very important. My wife and I used to love to walk through the model homes in our old neighborhood. They always looked so nice and orderly. All staged houses have one thing in common. They are completely unlivable. They don’t account for watching TV, having parties, doing the day to day stuff that all of us do. The bedrooms are museums not functional areas.
You watch HGTV shows like “Designed to Sell” and “Property Ladder” and when they are done they basically have a good looking house that is completely unlivable. And they show the sheep walking through saying things like, “oh, that looks wonderful. This is such a good idea.” I walk through and say, “when I am ready to pass out, where will I fall?” Practicality has left the American mindset, I think.
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the best “staging” is to empty the place out and clear all your shiiit out. i’m not impressed by your junky furniture and chap knick knacks and bad art.
cheap knick knacks
does anyone know if pool water evaportion increases due to pizza oven like heat in AZ?
Or does pool water evaporate regardless of outside temps?
Reason I ask is if a model home has an 18′ by 35′ by 9′ foot pool how many days would it take for a full pool to evaporate if no additonal water was added daily?
And how much does it cost to fill a pool with fresh water?
I suspect it’s mostly a function of relative humidity in the air. Warm dry air will evaporate more water, but cold dry air will also evaporate water, thus freeze drying technology.
Of course it does. You just need a cover.
You can get the annual evaporation rate for the area from the NWS. It is probably about 100 inches, or roughly 1/3 inch per day. The answer is something less than a year.
Forgot the rest of the question. The pool you mention will lose about 120 gallons/day (uncovered). So you can get the water rate and figure it out from there.
It’s not the water cost that will break you; it’s the other maintenance. You have to run the pool pump, and that can easily be 10 cents an hour in electricity alone. Granted, you won’t run it 24 hours a day, but you will run it 4-6 hours. Then there’s chemicals, which aren’t cheap, and you might even pay someone (ouch!) to monitor/add them.
We once figured about $400 minimum to run a basic pool for six months in the northern Virginia area, NOT including fixing things that break nor the cost if someone else did the maintenance. YMMV, but even in Phoenix, water cost won’t be the worst cost.
“Diane Neslund, a Scottsdale interior designer who also does staging, said that it gives the illusion that you’re not desperate to sell your home. ‘People will think that they had better hurry up and buy it or somebody else will,’ she said.”
I don’t see it that way. If I see an empty home, they have already moved out and are feeling more pressure to close a deal. Not to mention if it looks like it’s staged, the seller is spending even more $ they have to make up later.
At least she admits the point of the entire exercise is illusion. I hate that David Copperfield crap.
I really wish they wouldn’t bother - if they’re that desperate to sell, why not lower the price by the amount they’re spending on ’staging’.
And, if the furniture and chachkis aren’t going to be there when I’ve bought it, why get ‘em out of my way! You’re overstuffed sofa is in the way of my measuring up the room for furniture that I actually want to have!
OK, call me a cynic.
Wow. This Prescott Town Council member is delusional. And the local developer appears to be the most rational person quoted.
“We had that spike there for the past two-and-a-half years where everything went crazy,” said Joe Contadino, developer of the Granville subdivision. “Now we’re back at that 2003 level. This notion set in that a house wasn’t a home, it was an investment vehicle. Then the bubble burst.”
The town is hoping for a new bubble or, at least, some market improvement by February.
“It’s going to go up, this market that we’re concerned about,” Councilmember Lora Lee Nye said during a recent council meeting. “Do I have bad dreams or trouble going to sleep sometimes? Sure I do.”
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I would like to ask that dingbat, “why? what’s going to make it magically go up? any time soon?” And the good Councilwoman probably has no education or experience in business or economics.
Hmm, the town is hoping for a new bubble. Maybe they should put something hallucinogenic in the drinking water. Whatever Lora Lee Nye is already taking.
SW, it must be peyote.
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“Hope is not a strategy.”
“It’s going to go up,”
“It’s going to go up,”
“It’s going to go up,”
Why is nothing happening? I already clicked 3 times.
“‘You’re setting a mood, and you’re showcasing the lifestyle you could lead in this home,’
If only you had any money left over after paying the mortgage……
‘Pinal County’s recent housing boom has caused demands for shopping, entertainment and infrastructure to soar. Despite a more recent cooling in the housing market, the county’s west side is still poised for tens of thousands of new homes.’
‘Call 792-3087. That’s the number of the ‘Don’t Borrow Trouble’ hot line, a new Pima County service that aims to steer Tucsonans away from predatory lenders and assist those who have already become involved with such lenders. Christina Colchado, project coordinator, said the hot line has been busy in its first week-and-a-half of operation, averaging six to 10 calls a day. ‘People tell me often that the loan terms change, the fees change. The loan they get offered is not the loan they end up with,’ Colchado said. ‘Unfortunately, we have had people call about home foreclosures. . . . People don’t understand changing interest rates, balloon payments, things like that. They call us after they’ve realized they did something wrong.’
“They call us after they’ve realized they did something wrong.”
“Did something wrong”? Hell, it’s not like they killed someone and can’t live with the guilt and are going to jail.
I think she meant to say they made an ignorant decision and now they don’t know what to do.
>“Diane Neslund, a Scottsdale interior designer who also does staging, said that it gives the illusion that you’re not desperate to sell your home. ‘People will think that they had better hurry up and buy it or somebody else will,’ she said.”
Classic Sales “Scarcity Close”.
“Never get emotional about stocks or real estate - it clouds the judgement.”
>‘It takes pretty strong income to be able to afford homes in the $500,000 or $400,000-plus range,’ he said.”
Oh really? Even with an I/O ARM???????
two comments…. my uncle rents million-dollar homes that are for sale. he pays $1200/month plus utilities. the agents of these home want them to look like someone is actually living in them. his last rental was an 8000 sqf estate atop of fountain hills.
last night, former girlfriend called to tell me that she was buying “another house”. she already owns a 1500 sqf home that the traditional arm just reset on. it seems that the “new” house is a trend homes model and she got a great deal. no down, no closing costs and no payments for 1 year. but wait… there is a catch. you actually make monthly payments,but they reimburse you every month. is that really no payments. the water in gilbert must be worse than the water here in chandler.
dude - good thing that is a FORMER girlfriend. That stupidity is like an albatross around your neck…
i wholeheartedly agree but the “current” girlfriend is not much better. she desparately wants out of her North Phoenix condo. at least i can tell the current one “no we are not going to buy a house in scottsdale this year”
Oh , cash to pay payments ,interesting . Wonder if the lender approved this .
Doesn’t everybody just want lower prices and lower taxes and insurance . I hope the secondary market just quits buying loans right now. To much BS going on ,to much fraud etc., to many unstable owners of property , to many people in la la land . Don’t ask me to pay for this out of my taxes .
Hey, if the secondary market quit purchasing these loans you would see mortgage requirements go so high that most individuals wouldn’t qualify and BINGO goes the prices ,in the tank!
I use to lend with a bank that carried their own loans and they just made good loans that all .
The forclosures from bad loans and up-side down investors is what is going to push the market into the tank . In other words ,the bad loans created the demand that drove the prices up ,as well as high speculation demand and caused the builders to over-build . The market has to correct regardless because of the prior acts of lenders on loan volume . I don’t think the secondary market would want to keep this party going as they find out what the real risk was by loss .
So that is why I am saying ,why don’t they stop the party now so the whole system can change rather than making it worst by setting up more loss .
It’s like saying would you of rather seen the stock market crash in 1925 because they decided to stop margin buying ,instead of it crashing hard in 1929 onward setting off a major depression ?
Wonder if you can get a no-doc loan for this:
http://phoenix.craigslist.org/rfs/230111796.html
uh…maybe here?
http://www.deadloanfunding.com/